The HVAC industry has faced significant uncertainty recently due to fluctuating tariff policies. As a result, some equipment and refrigerant manufacturers have raised prices preemptively in anticipation of potential tariff hikes. These cost increases have been passed down the supply chain, ultimately affecting distributors, contractors, and consumers.
Lennox, however, recently announced that it would be reducing its surcharge rates on some equipment for U.S. dealers. In a notice to customers, Lanessa Bannister, vice president and general manager of Lennox Residential, stated, “In light of recent news on tariffs, we are pleased to inform you that we will be reducing our surcharge rates to the following, effective May 16, 2025:”
| Category | Product Group | Surcharge |
| Dave Lennox Signature Collection & Elite Series | 2% | |
| Equipment | Merit Series | 3% |
| Packaged Units | 2% | |
| Coils | 3% | |
| Mini-Splits | 10% | |
| Parts & Supplies | 0% |
She stated that the reason for this change is due to the dynamic nature of the economy and global markets. “The situation is evolving, and as updates arise, we will continue to keep you informed,” she said. “We encourage you to review the updated surcharge rates and reach out to your Lennox representative if you have any questions or need further assistance.”
Manufacturer Notices
The Lennox notice is the latest in a string of announcements from manufacturers, regarding the price of HVAC equipment and/or refrigerant. On April 11, Honeywell notified customers of a 42% surcharge for R-454B, citing rising raw material costs and anticipated tariffs. This followed a 15% increase the company implemented on the A2L refrigerant in February and an additional 8% hike in March.
The Honeywell announcement highlighted how contractors are struggling to secure enough cylinders of R-454B, which is a widely used A2L replacement for R-410A. With lead times stretching to months and the busy summer season already here in some parts of the country, the combination of limited availability and rising costs is creating serious challenges across the HVACR industry.
In fact, this lack of aftermarket R-454B recently led Trane to temporarily increase the factory pre-charge of refrigerant in all vertical-discharge split air conditioner and heat pump models, in both the premium and the value lines that use the A2L refrigerant. The company said the increased refrigerant levels will accommodate common system matches with a 25-foot line set and a 3/8-inch liquid line. To account for the additional refrigerant, Trane applied a $50 charge to each unit.
The Trane notice went on to state that the increase from the standard factory charge will eliminate the need to add refrigerant, or reduce the amount of additional refrigerant needed, at the time of installation.
Carrier also recently announced that it would begin increasing the amount of refrigerant pre-charged in residential ducted splits from the standard 15-foot line set to 30 feet on most units. However, the company is not applying any incremental surcharges for the increased refrigerant.
“Carrier’s objective throughout this transition is to offer equitable allocation based on equipment sales and proactive coordination, without any cost increases,” said Nick Arch, vice president and general manager of residential HVAC solutions at Carrier. “We remain dedicated to demonstrating industry leadership and building customer confidence through bold measures and quick, strategic actions.”
In their Q1 2025 earnings reports, both Lennox and Carrier addressed the ongoing R-454B shortage, its impact on the industry, and when they expect the situation to improve. David Gitlin, chairman and CEO of Carrier Global Corp., said he didn’t believe the shortage will be a long-term issue. “I think the shortage that everyone’s talking about was the canisters that were affecting the overall channel, and we see that resolving itself here in the second quarter.”
On tariffs, Lennox, Carrier, and Trane, all said in their earnings calls that they would ultimately affect the price of HVAC equipment. According to Chris Kuehn, executive vice president and CFO of Trane, “We estimate the cost impact [of tariffs] in 2025 to be approximately $250 million to $275 million.”
Given the dynamic tariff environment, Kuehn said it was premature to build specific pricing into their revenue guidance; however, between February and April of this year, Trane implemented several price increases and/or surcharges.
“Think of them as if it’s a price increase, which gives us a lot of flexibility to be very surgical in how we’re thinking about a price increase,” said Kuehn. “And then a surcharge could be in place, but then also easily removed as we see changes possibly happening here in the tariff environment.”